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Hiotogp^hic 

Sciences 

Corporation 


23  WEST  MAIN  STREET 

WEBSTER,  N.V.  MSSO 

(7^6)  872-4503 


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CIHM/ICMH 

Microfiche 

Series. 


CIHM/ICMH 
Collection  de 
microfiches. 


Canadian  Institute  for  Historical  Microreproductions  /  Institut  Canadian  de  microreproductSons  historiques 


Technical  and  Bibliographic  Notes/Notes  techniques  et  bibliographiques 


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24X                            28X                            32X 

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shall  contain  the  symbol  ^•►{meaning  "CON- 
TINUED "),  or  the  symbol  V  (mecning  "END  "), 
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method: 


Les  exemplaires  originaux  dont  la  couverture  en 
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par  le  premier  plat  et  en  terminant  soit  par  la 
deniidre  page  qui  comporte  une  empreinte 
d'impression  ou  d'illustration,  soit  par  le  second 
plat,  selon  le  cas.  Tous  les  autkuts  exemplaires 
originaux  sont  film6s  en  commenpant  par  la 
premidre  pnge  qui  comporte  une  empreiri^e 
d'impression  ou  d'illustration  et  en  termirant  par 
la  dernidre  page  qui  comporte  une  telle 
empreinte. 

Un  des  symboles  suivants  apparaitra  sur  la 
dernidre  image  de  cheque  microfiche,  selon  le 
cas:  le  symbole  —^  signifie  "A  SUIVRE",  le 
symbols  V  signifie  "FIN". 

Les  cartes,  planches,  tableaux,  etc.,  peuvent  dtre 
film6s  d  des  taux  de  reduction  diffdrents. 
Lorsque  le  document  est  trop  grand  pour  dtre 
reproduit  en  un  seul  clich6.  il  est  film6  A  partir 
de  I'angle  supdrieur  gauche,  de  gauche  d  droita, 
et  de  haut  en  bas,  en  prenant  le  nombre 
d'images  ndcessaire.  Les  diagrammes  suivants 
illustrent  la  mdthode. 


t  2  3 


1 

1 

2 

3 

4 

5 

6 

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ti3:e]  xjnsrionsr  oi^ 

Telegraph  Interests  in  Canada. 


A  Letter  to  the  Shareholders  of  the  Montreal  Telegraph  Company 


BY 


ERASTUS  WIMAN. 


: 


/  '6    ?/        ^^ 


'^.,. 


I  VLIRRAIIJK8,'<'J 
»5\        27  Rue  Buade, 


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TO  THE  SHAREHOLDERS 


OK  THK 


MOITREAL  TELEGRAPH  COMPANY. 


>♦< 


I 


GENTLEMEN : 

I  venture  to  address  you  iu  relation  to  the  proposition  which  is  to 
be  Bubrnittcd  to  your  decision  at  the  Special  General  Meeting  called  for  the 
IGth  of  July  next,  on  which  occasion  you  will  be  asked  whcither  you  will 
consent  to  a  contract  for  the  working  of  your  lines  by  another  telegraph 
company,  under  a  guarantee  to  you  of  Eight  per  cent,  per  annum  on  the  capi- 
tal of  your  conipanj\  I  take  this  liberty  btf-ause  I  have  been  more  or  less 
concerned  in  the  negotiations  which  have  resulted  in  this  proposition,  and 
because  there  seems  to  exist  a  misunderstanding  and  a  i)rejudice,  which  is 
most  unjust  to  the  measure  now  before  you,  and  which,  unless  removed,  may 
Boiioiisly  interfere  with  the  wisdom  of  the  judgment  at  which  you  may 

arrive. 

THE  PLAN  PROPOSED. 

In  order  that  you  may  clearly  apprehend  the  plan  proposed  for  the 
fusion  of  telegraph  interests  iu  Canada,  an  estracc  is  herewith  submitted, 
which,  in  a  measure,  explains  the  same.  This  memorandum  puts  into 
shape  and  form  the  result  of  negotiations  extending  over  several  weeks,  in 
which  serious  legal  difflculties  were  encountered,  but  surmounted  by  the 
pl?.n  now  T)roposed. 

The  Great  North  Western  Telegraph  Company  of  Canada  desire  to  place 
themselves  in  the  position  of  contractors,  to  undertake  tae  working  of  the 
lines  of  the  Montreal  Telegraph  Company,  at  a  fixed  rate  of  remuneration, 
uj)on  the  terms  and  conditions  of  an  agreement,  to  bo  hereafter  drawn  up. 
The  contractors  are  to  undertake,  for  a  period  of  91)  years,  to  work,  manage, 
and  operate  the  lines  of  the  Montreal  Company,  by  means  of  its  own  em- 
ployes and  operators,  and  to  conduct  the  business  in  the  same  manner,  and 
to  the  same  extent,  that  the  Montreal  Company  has  heretofore  conducted 
it,  performing,  to  the  fullest  extent,  all  tlie  obligations  of  the  company  to- 
wards the  public.  And  the  contractors  bind  and  pledge  themselves  to  pay 
to  the  Montreal  Company,  quarterly,  during  the  continuance  of  this  agree- 
ment, the  sum  of  forty-one  thousand  dollars,  on  the  iirst  days  of  January, 
April,  July,  and  October,  of  each  year,  or  at  the  rate  of  eight  per  cent,  per 
annum,  on  the  capital  stock  of  the  Montreal  Company,  and  four  thousand 
dollars  for  the  maintenance  of  the  organization  of  the  same.  The  Western 
Union  Telegraph  Company  to  be  parties  to  this  agreement,  in  consideration 
of  certain  arrangements  with  them,  they  binding  and  pledging  themselves 
as  sureties  of  the  said  contractors  for  the  payment  of  ail  sums  ci"  money  and 
for  the  performance  of  all  the  obligations  and  duties  wliich  these  contractors 
undertake.  And  it  is  agreed  by  the  contractors  that  no  charge  greater 
than  t-,Tenty-five  cents  shall  be  made  for  the  transmission  of  a  message  of 
ten  words  over  the  present  extent  of  the  lines  of  the  company. 


wrnni 


THE  PLAX  rnOVOSED. 


After  (hio  considoration  the  Board,  through  itH  a<;tiiig  Secretary, 
notilied  me  of  their  approval  of  this  seheiue,  and  caUed  i  he  meeting  of 
stockhohh'rs  by  the  advertisement  with  wliich  you  aro  familiar. 

There  are,  of  course,  other  conditions  of  the  pioposed  af^reement  than 
aro  contained  in  the  forej;oin<j;  hut  the  {general  bases  of  the  jtropositions 
submitted  are  more  clearly  set  forth  in  this  commnnication  than  can  be 
shortly  gleaned  from  any  other  source.  An  agreennmt  completely  protecting 
your  interests,  and  covering  all  the  points  essential  to  legality  and  safety, 
has  lieen  drawn  up  by  your  own  counsel,  Hon.  J.  J.  C'.  Ahhott,  and  is  to  be 
submitted  for  consideration. 

It  will  be  noticed  that  the  Montreal  Telegrajdi  is  in  the  position  of  em- 
ployer, that  its  organization,  powers,  and  dignity  are  undisturbed.  The  Great 
Nortn  Western  Telegraph  Company  s(!cks,  on  the  other  hanu,  to  occupy 
8im])ly  the  position  of  a  ccmtractor  to  your  corporation,  whose  remuneration 
is  dependent  upon  good  managenumt  and  success  of  the  administration  of 
affairs,  but  against  the  consequences  of  whose  failure  you  have  a  safe  and 
ample  guarantee. 

CONDEMNED  UNHEARD. 

It  would  ill  become  me  to  question  die  sincerity  of  parties  who  condemn 
the  scheme  as  proposed;  but  it  is  submitted  that  this  condenuiation  has 
been  most  unjust,  because  no  attempt  has  been  made  to  get  at  the  facts  of 
the  case,  and  no  explanations  Avero  sought  before  judgment  was  attempted 
to  be  entered  up  in  the  public  mind  against  the  project.  The  chief  ground 
of  complaint  has  been,  that  the  telegraph  companies  were  about  to  pass 
under  the  control  of  Americans,  that  the  telegraph  system  of  Canada  would 
become  denationalized,  and  tliat  there  was  no  assurance  that  the  most 
exorbitant  rates  might  not  be  charged  for  messages.  The  <')iange8  have 
been  rung  from  one  end  of  the  Dominion  to  the  other,  with  variations  of 
these  charges,  and  a  prejudice  adverse  to  the  proposed  amalgar.mtion  has 
been  created,  which  has  no  foundation,  and  is  simply  the  result  of  ignorance 
or  design.  The  truth  is,  that,  the  whole  scheme,  as  now  before  you,  has 
been  proposed  and  promoted  for  the  very  purpose  of  obviating  the  possi- 
bility of  results  such  as  are  charged  against  it.  Thus,  instead  of  an  Ameii- 
can  company  obtaining  possession  of  the  Canadian  telegrai)h  lines,  it  is 
proposed  that  a  purely  Canadian  company  shall  be  the  instrument  used  for 
combining  what  might  easily  become  very  conHicting  interests,  and  with 
disastrous  results.  This  company,  known  as  'I  he  Great  North  Western  Tele- 
graph Company  of  Canada,  was  created  under  a  Canadian  charter,  is  com- 
posed almost  entirely  of  Canadian  stockholders,  with  a  board  of  Canadian 
directors,  and  offlcered  solely  by  Canadians,  employing  a  Canadian  staff  only. 
What  element  of  adverse  Americanism  is  herein  contained,  it  is  difficult  to 
discover.  It  is  true  that  the  Western  Uaioa  Company  undertake  for  the 
Great  North  Western  Company,  a  guarantee  of  an  ei^^li  per  cent,  dividend 
on  the  capital  of  the  Montreal  Telegraph  Company,  and  pay  a  six  per  cent, 
dividend  to  the  Dominion  Company,  and  in  consideration  of  this  very  great 
liberality,  they  are  to  receive  one-half  of  the  profits  of  The  Great  North  West- 
ern Company.     Is  there  anything  very  heinous  or  very  startling  in  this 


I 


I 


CONDEMNED  UNHEARD. 


jccretary, 
leetiiig  of 


lent  than 
Dpositions 
iin  can  bo 
[trotecting 
11(1  Hafety, 
h1  is  to  1)« 

ion  of  eni- 
Tlio  Great 
to  oc(;ni»y 
iinneratio)! 
stratloii  of 
a  safe  an«l 


lo  condemn 
nation  has 
the  facts  of 
4  atteinjited 
lief  ground 
)at  to  pass 
nada  wouhl 
,t  the  most 
anges  have 
ariations  of 
ii.iation  has 
)f  ignorance 
>ro  you,  has 
g  the  possi- 
if  an  Ameii- 
1  lines,  it  is 
lent  used  for 
ts,  and  Avith 
estern  Tele- 
'ter,  is  com- 
of  Canadian 
vn  staff  only. 
8  difficult  to 
;ako  for  the 
nt.  dividend 
six  per  cent. 
is  very  great 
North  West- 
bling  in  this 


proposition?  Docs  it  imply  destruction  of  a  national  element  in  the  Cana- 
dian telegraph  system,  or  is  it  subversive  of  any  sentiment  of  loyalty  or 
patriotism  to  the  Dominion,  that  a  foreign  corporation,  with  80  millions  of 
capital,  for  the  sake  of  peace  and  harmony,  and  a  profitable  connection, 
should  undertake  to  guarantee  the  payirent  of  nearly  a  quarter  of  a  million 
of  dollars  to  Canadian  stockholders,  and  ])articipate  in  the  mutual  advan- 
tages of  this  friendly  arrangement  ?  I'arties  who  indulge  in  this  kind  of 
criticism  forget,  or  ignore,  the  fact  that  the  lines  of  the  Montreal  Telegraph 
Company  extend  into  several  of  the  adjoining  States;  that  tlie  company 
occupy  a  largo  portion  of  the  State  of  New  York,  and  have  also  offices  iu 
New  Hampshire,  Maine,  Vermont,  and  Michigan.  Fortunately  for  the 
business  interests  and  intercourse  between  ourselves  and  our  neighbours 
across  the  line,  there  is  no  arbitrary  national  boundary  or  dividing  line 
between  the  telegraph  arrangements  connecting  the  two  countries. 

UNFOUNDED  FEARS. 

The  terrors  which  have  hp.ow  evoked  of  American  domination  in  the 
Telegraph  system,  when  closoTy  si-rutinized,  are  found  to  bo  wholly  imagin- 
ary, and  they  would  be  amusing  if  they  were  not  pitiable.  One  would 
think  that  there  was  some  poison  or  contamination  in  the  great  nation  on 
your  borders  ;  that  the  tratflc  Avhich  crowds  your  railroads,  the  travel  which 
fills  your  hotels,  should  be  avoided  and  spurned.  One  would  think  that  the 
great  system  of  telegraphy,  the  invention  of  an  American,  and  which  the 
enterprise  and  capital  of  the  people  of  the  United  States  has  made  second 
only  in  universality  and  utility  to  the  post  office,  was  to  be  ignored  by  the 
stockholders  of  the  Montreal  Telegraph  Company,  because  it  suits  the  pur- 
pose of  a  few  interested  parties  to  work  up,  for  their  own  purposes,  a  senti- 
ment which  is  narrow,  false,  and  unjust.  Of  all  people  in  the  world  the 
stockholders  of  the  Montreal  Telegraph  Company  can  least  atford  to  indulge 
in  this  kind  of  sentiment,  Avhen  the  sole  chance  of  profit  depends  upon  a 
connection  with  the  country  so  maligned. 

THE  RESULT  OF  DEFEAT. 

The  very  thing  which  these  parties  make  such  an  outcry  against  is 
much  more  likely  to  happen  if  the  project  now  before  you  is  not  favorably 
considered,  viz:  control  by  Americans  of  the  Telegraph  system  of  Canada 
It  is,  of  course,  known  to  you  that  the  Western  Union  Company  are  now 
virtually  proprietors  of  the  Dominion  Company  under  their  lease  for  99 
years  at  5  per  cent.,  in  addition  to  which  Mr.  Gould  holds  nearly  a  quarter 
of  a  million  of  the  stock  of  the  Company.  If  the  Montreal  Company  are 
not  inclined  to  accept  the  liberal  terms  that  are  proposed  to  them  under  the 
new  contract  offered,  it  is  incredible  to  snppose  that  the  Western  Union 
people  will  continue  to  divide  their  busiuess  between  the  two  Canadian 
Companies.  If  the  offer  now  before  the  Mootreal  stockholders  be  rejected, 
it  will  follow,  of  course,  that  they  must  lose  the  entire  American  business, 
and  th?.^  the  cable  business  will  also  be  concentrated  in  the  Dominion 
Company.    The  consequence  would,  of  course,  be  that  the  Montreal  Com- 


6 


THE  RICSULT  OF  DEFEAT. 


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pauy,  deprived  of  i>robiibly  |iiiOG,00()  a  year,  could  not  pay  dividomlH  ;  and 
its  8tocl<  would  certainly  fall  in  value  to  a  point  lower  tliau  it  has  ever 
<lone  before.  What  the  final  result  might  be,  it  is  hardly  necessary  to 
indicate. 

THE  CONSEQUENCES  OF  ACCEPTANCE. 

In  opposition  to  the  possibilities,  not  to  say  the  probabilities,  thus  indi- 
cated, how  much  more  attractive  is  the  offer  now  before  you  ?  A  certain 
and  fixed  value  to  the  stock,  at  a  figure  fully  up  to  its  intrinsic  worth,  is 
secured  by  a  regular  and  certain  (luarterly  payment  of  a  dividend  of  Eight 
l)er  cent.,  a  rate  which  creates  surprise  among  those  familiar  with  the  perils 
to  which  the  property  is  exposed,  and  the  dead  certainty  of  the  extinction 
of  dividends  should  the  offer  be  refused.  But  beyond  all  this,  is  the  condition 
which  has  laid  at  the  bottom  of  the  whole  negotiation  ever  since  its  coui- 
mencenient,  viz:  that  the  maximum  rate  for  ten-word  messages  should  not 
exceed,  within  the  provinces  of  Ontario  and  Quebec,  2r>  cents,  and  should  any 
attempt  be  made  to  exceed  this  charge  the  whole  agreement  should  bo  null 
and  void.  Thus  the  parties  in  opposition,  in  endeavoring  to  defeat  the 
proposition  now  before  you,  are  contributing  to  the  destruction  of  a  plan  to 
accomplish  the  two  great  purposes  which  they  all  i)rofe8sedly  desire  to 
SCO  a(;complished.  These  two  ends  are :  1st,  a  permanent  and  certain  profit 
to  the  stockholders ;  yd,  a  rate  as  low  as  prevails  under  the  jiostal  system 
of  Great  Britain,  with  far  greater  facilities  in  proportion  to  population, 
distance  and  use.  If  any  other  plan  can  accomplish  these  objects  more 
desirably  or  more  effectually,  and  which  cau  be  made  practicable  and 
acceptable  to  the  jiarti-^s  interested,  both  in  the  United  States  and  Canada, 
it  has  failed  yet  to  devek  n  itself. 

THE  OPPOSITION  OF  THE  PRESS. 

While  a  portion  of  the  j)res8  have  taken  a  fair  and  impartial  vi  nv  of  the 
proposed  arrangement,  and  have  fairly  recognized  and  considered  the  in- 
terests of  all  concerned,  others  have  dealt  with  the  question  in  such  a 
manner  as  would  seem  to  indicate  that  shareholders  who  invest  their  money 
in  telegrai)h8  have  no  interests  or  rights  which  are  entitled  to  the  slightest 
consideration.  The  regular  rates  charged  the  press  in  Canada  for  news  re- 
ports ar(5  probably  the  lowest  in  the  world;  and  even  these  rates  have  been, 
in  some  cases,  demoralized  by  'ohe  ruinous  competition  of  the  companies. 
It  is  "'>t  the  intention  to  increase  these  rates  beyond  a  point  Avhich  shall  bo 
the  lowest  reasonable  compensation  for  the  service.  It  Avill  be  the  inten- 
tion to  make  these  rates  uniform  to  all;  and,  if  for  special  reiiorts  to  any 
newspajier  the  maxiumm  rate  is  named  at  twenty-five  cents  per  hundred 
words,  no  reasonable  fault  can  ]»p  'bund.  It  is  well  known  that  telegraph 
lines  could  not  be  built  or  operated  to  do  business  at  any  such  rates  except 
at  a  heavy  loss,  were  it  not  in  connection  "with  the  commercial  business  of 
the  country.  Special  etfbrts  will  bo  made  to  serve  the  press,  and  these  ef- 
forts will  be  largely  aided  by  the  friendly  business  relations  which  it  is  pro- 
posed to  establish  with  the  Western  Union  Company,  by  means  of  which 
their  co-operation  over  their  vast  area  of  territory  and  extensive  cable  con- 


t 


TttK  OPPOSITION  OF  THE  J'RESS. 


Ills;   ami 

lia»  ever 

CHHary  to 


thus  iudi- 
A  certain 
a  worth,  is 
il  of  I'^iglit 
L  the  perils 

oxtiuctioii 
D  coiuUtion 
loe  itH  i'oiu- 
shouUl  not 

should  any 
(Ulfl  ho  uiill 

defeat  the 
jf  a  idau  to 
ly  desire  to 
ertaiu  proiit 
ostal  system 

population, 
)bjec'ts  more 
;ticahlo  and 
and  Canada, 


a  vi  'W  of  the 
iliicd  the  iu- 
)u  iu  such  a 
t  their  money 

the  slightest 
i  for  news  re- 
teshave  heen, 
ho  companies, 
vhich  shall  he 

be  the  inten- 
eports  to  any 
s  per  hundred 
Dhat  telegraph 
h  rates  except 
ial  business  of 

I,  and  these  ef- 
.vhich  it  is  pro- 
aeans  of  which 
sive  cahle  con- 


I 


ncctions  will  bo  fully  assured,  in  addition  to  the  low  rate  of  trauHnusslon 
for  local  nowH. 

But,  in  addition  to  the  low  rate  of  transmission,  the  C.iuiuliau  press 
enjoy  advantages  from  the  Telegraph  Companies  of  a  very  pi .  iiliar  charac- 
ter, and  that  is  the  amount  of  news  tliey  daily  get,  liio  gleaning  and  pre- 
paration of  which  costs  them  literally  nothing.  Without  charge  to  them, 
the  whole  of  one  side  of  each  daily  paper  is  lilled  with  tele<:;raphic  advices 
of  events  transpiring  in  all  jjarts  of  the  world,  from  tlio  most  stupendous 
occurrence  in  the  most  distant  and  important  quarter,  down  to  the  most 
insigniticant  and  trivial  event  that  hai>pens  in  tlie  remotest  part  of  the 
Dominion.  Thus,  in  one  day,  there  are  two  columns  recounting  the  assas- 
sination of  the  Emperor  of  Russia,  a  few  hours  before,  in  St.  Tetersburg, 
side  by  side  with  the  account  of  a  broken  leg  of  some  poor  lumbernum  in 
Bobcaygeon,  all  of  which  in  fjot  irilhont  auij  effort  at  all  on  hchalf  of  the  editors 
anil  proprietors  of  the  ncwnpapera,  and  in  furnished  to  them  at  rates  so  loto  as 
ahsolntehj  not  to  pay  the  cost  of  transmisaiou.  Thus,  for  $25  or  fliO  a  week, 
whole  columns  of  news  are  gleaned  iVom  all  parts  of  the  -A^orlil.  It  is  pos- 
sihlo,  that  under  sonui  other  arrangement,  wherein  a  fair  profit  Avill  bo 
sought,  newspapers  may  have  to  jiay  a  little  more  than  they  have  been 
paying  for  transmitting  their  columns  of  matter  daily,  and  it  is  natural  that 
they  should  discover,  in  any  i)lan  looking  towards  liarmony  of  telegraph 
iutrests,  objections  and  disadvantages  which  they  will  not  bo  slow  to  dis- 
cuss. But  with  rates  fixed  at  the  figure  above  (piotcd,  there  certainly 
ought  not  to  be  any  such  objection  urged  on  the  score  of  disadvantage  to 
the  press.  The  fact  is,  tlie  advantages  are  all  on  their  side,  and  none  what- 
ever on  the  side  of  others. 

OITOSITION  OF  THE  BKOKEKS. 

With  regard  to  the  brokers,  the  ground  of  their  opposition  is  of  course 
palpable.  No  stock  in  the  entire  list  has  yielded  such  a  good  return  in  com- 
missions to  these  gentlemen  as  the  Montreal  Telegraph  Company.  Not  only 
has  it  fluctuated  much  and  rapidly  (the  rang<i  in  the  last  two  years  being 
from  50  to  60  per  cent. ),  but  the  transactions  have  been  numerous  and  large. 
That  these  fluctuations  will  continne  to  an  even  greater  extent  than  before, 
should  the  terms  of  amalgamation  be  rejected,  is  as  certain  as  that  the  sun 
shines.  To  expect,  therefore,  anything  but  hostility  from  gentlemen  whose 
income  depends  on  these  fluctuations,  is  to  expect  human  nature  to  change. 
If  the  stock  should  decline,  as  it  most  assuredly  would  upon  the  rejection 
of  the  terms  now  before  you,  the  brokers  would  reap  a  rich  harvest.  Any 
attempt  made  to  get  control  of  the  stock  by  i^arties  outside,  or  any  move- 
ment wiiatever  either  up  or  down,  would  make  it  e(pially  profitable.  The 
stock  of  the  Montreal  Telegraph  Company  has  been  the  football  of  the 
market,  kicked  hither  and  thither  by  every  idle  rumor,  and  subject  to  every 
influence,  favorable  or  unfavorable.  The  extreme  x'cril  to  which  the  pro- 
perty is  exposed  from  competition,  and  the  extraordinary  class  of  circum- 
stances which  surround  it,  both  from  its  United  Stat'^s  and  cable  con- 
nections, will  always  make  the  stock  one  of  fluctuating  value,  unless  some 


I 


8  OPPOSITION  OP  THE  lUtOKI'lIiS. 

Hich  plun  UH  Ih  now  propoHOil  Ih  iitlopttMl,  to  {iiimlgiiiniitu  uiul  coiiHoliilato  tlio 
variouM  coiiflicUng  iiitnrt'stH.  Under  rtucli  circuuiHtunceH  tlio  brokers  will 
most  iiuturally  bo  opposed  to  tlio  rcmoviil  of  the  wtock  from  tlio  niarkot, 
and  placing  it  uninnj;  tlio  nIcxiUh  which  will  bo  Honghfc  for  investniont  pnr- 
poscH,  f;iving  it  ii  Htablo  and  hij;h  \  alnc.  How  far  tho  Htockhohhirs  who  own 
tho  property,  and  who  wonld  like  to  got  a  rovcnuo  from  it,  and  see  its  valne 
certain  and  permanent,  flhare  in  tho  brokers'  view  of  tho  case,  they  ninst  for 
tbeniHelves  dotermine. 


i 

l! 

if' 


THK  OPPOSITION  OF  THE  ITBLK!. 

Tho  i)nblic,  too,  aro  iw  «loiibt  averse  to  any  scliemo  of  auialgamation 
that  will  necessitato  a  sominvhat  advanced  rato  for  telegraphic  nie.ssages. 
For  the  last  two  year.s  th(5  pnl)lic  have  had  things  pretty  much  their  own 
way,  80  far  as  telegraphic  business  is  concerned,  not  only  as  to  tho  rates, 
but  in  tho  fact  thah  nowhere  else  in  tho  world  have  so  many  privileges  and 
faciliticH  beciu  furnished,  owing  to  tho  excessive  coinpcititiou  that  has  pro- 
vailed,  resulting  in  bids  for  i)nsine8S  which  have  been  disastrous  to  profit. 
It  is,  therefore,  not  surprising  that  tho  adverse  criticisms  have  fonnu  ready 
acquiescence  in  tho  public  mind,  because  it  is  anticipated  that  tho  amalga- 
mation of  telegraph  interests  will  result  in  tho  demand  for  better  ron^uner- 
ation  for  services  performed.  Tliat  this  remuneration  has  been  too  low 
every  person  j'amiliar  with  t(  h-graph  matters  fully  understands.  In  view 
of  the  distances,  the  facilities  and  the  extent  of  tho  business,  twenty  cents 
for  ten  words,  within  anj'  portion  of  tho  Provinces  of  Quebec  and  Ontario, 
is  a  rate  twenty  per  cent,  lower,  in  proportion,  than  that  which  tho  British 
Government,  in  its  perfect  postal  telegraph  system,  requires.  It  is  certain- 
ly totally  inadequate,  as  is  shown  by  experience,  to  keep  tho  property  in 
repair  and  to  make  a  reiisonablo  compensation  for  the  cai)ital  employed.  It  is 
true  that  tho  stockholders  of  the  Montreal  Company  have  been  getting 
dividends  at  tho  rate  of  seven  or  eight  per  cent.,  but  it  is  notorious  that 
it  has  been  paid  to  them  with  tho  greatest  difficulty,  anu  at  an  expense 
which,  in  a  very  little  while,  will  be  a  most  serious  consideration  for  them  in 
tho  condition  in  which  their  property  is  now  found.  The  amount  expended 
for  renewals  and  extensions,  the  last  two  years,  has  been  totally  inadequate 
for  the  purpose,  and  the  expenditures,  which  must,  of  necessity,  be  made 
very  shortly,  will  be  very  large  in  repairing  and  rebuilding  lines.  It  will 
ho  remembered  that  the  company  was  able  to  pay  eight  per  cent.,  by  the 
sale  of  the  telephone,  which  this  year  will  not  bo  available. 

It  is  true  that  the  present  receipts  of  the  Montreal  Company  are  claimed 
to  be  largely  in  excess  of  last  year,  and  that  a  dividend  is  now  being  earned 
equivalent  to  the  amount  guaranteed  under  the  now  arrangement ;  but  it 
should  be  borne  in  mind  that  these  large  receipts  are  largely  the  result  of 
tho  amalgamation  in  the  United  States,  and  that  the  Montreal  Company, 
through  the  forbearance  of  the  Western  Union  Company,  is  in  receipt  of 
an  enhanced  amount  of  business  which  at  any  moment  could  be  diverted 
to  the  Dominion  Line,  should  the  arrangement  now  proposed  not  be  carried 
out.     A  dividend  at  all,  or  certainly  anything  approaching  eight  per  cent. 


THE  Ol'l'OSlTWS  OF  TJIK  PUBLIC. 


liiliito  the 
)kcrH  will 
)  nmrkot, 
inotit  pur- 
\  who  own 
1  itH  value 
y  imiat  for 


ilj^anmtion 
messages, 
their  own 
)  the  rates, 
viloj^es  and 
at  has  pro- 
is  to  profit, 
•ounu  ready 
the  amalga- 
cr  reiuuner- 
•en  too  h)W 
la.     In  view 
wenty  cents 
„d  Ontario, 
the  British 
t  is  certain- 
property  in 
ployed.  It  is 
)een  getting 
itorioua  that 
an  expense 
II  for  them  in 
mt  expended 
y  inadequate 
jity,  ho  made 
lies.      It  will 
cent.,  hy  tlie 

jy  are  claimed 
being  earned 
jment;  but  it 
V  the  result  of 
•oal  Company, 
ill  receipt  of 
A  be  diverted 
not  be  carried 
sight  por  cent. 


I 


I 


is  iwt  for  an  instant  to  ho  thniglit  of  in  the  face  of  a  twenty  rent  rate  for 
inosxagos,  couipotition  for  hitsincHH,  and  the  loss  of  all  principal  connctiunM. 

WHO  AKE  NOT  OPPOSHD. 

ll.iving  thus  nd'erri'd  to  the  three  oloinentH  fro.u  which  opposition  to  the 
proposed  aiicilgainatioti  seemed  to  proceoil,  it  is  in  onler  now  to  allude  to 
those  in  favor  of  it.  Those  who  favor  it  are  to  be  found  among  tho  large 
Mtockholders  whoso  indiviilual  Interests  are  most  seriously  threatened  by  u 
refusal  of  the  project,  or  benelitcd  by  its  acceptance,  yomo  are  doubtless  ilis- 
a))pointed,  however,  that  a  higher  dividend  is  not  sectircd,  and  somo  aro 
dis])osed  to  dispute  the  right  of  a  third  company  to  intervene  and  (hsprivo 
tho  Montreal  company  of  its  iudepcndtMice,  and  iill  chances  of  i)rotit  beyond 
tho  fixed  sum  of  eight  percent.  Bnt  it  must  be  l)orne  in  mind  that  somo 
such  arrangeinent  is  essential  t<»  a  consdidation  in  which  all  interests  aro 
to  be  consulted.  The  negotiations  in  relation  to  this  matter  have  extended 
over  several  months,  during  which  four  forms  of  settlement  were  developed, 
including  pooling,  leasing,  stock  consolidation,  and  tinally,  tho  plan  now 
before  you.  There  wcro  dithculties  and  disadvantages  in  all,  and  none 
seemed  to  bo  so  simple,  so  effective,  and  lik«dy  tobeso  ac(;eptablo  to  allof  the 
parties  most,  interested,  as  tho  i»lan  now  before  you.  Whatever  may  bo  its 
defects,  it  is  now  the  only  one  that  will  l)'>  agreed  to,  at  least  by  one  of  the 
parties  to  the  negotiations.  A  delegation  from  your  board  of  directors 
went  to  Now  York  to  meet  the  Western  Union  authorities,  and  while 
there  all  those  plans  were  discussed.  In  view  of  the  (londderations  urged, 
and  tho  objections  that  were  n\ade,  and,  especially,  the  attitude  assumed  by 
parties  in  intercsi/,  I  think  tho  delegation  will  confirm  the  statement  that 
this  is  tho  only  plan  that  is  at  once  feasible  and  acceptable.  By  it  a  liberal 
rate  of  dividend  is  assured  lieyond  i)eradventuro,  and  its  payment,  every 
quarter,  will  not  bcdependsnt  upon  tho  contingencies  of  business,  tho  uncer- 
tainties of  profit,  or  tho  certainties  of  competition,  llenco,  to  tlio.^  vho  aro 
the  largest  owners  of  stock  tho  proposed  plan  seems  tho  most  accepi      le. 

There  is  another  class,  however,  whoso  interests  it  is  most  impo,  ant 
to  bear  in  mind — that  is,  the  largo  number  of  holders  of  tho  stock,  more  or 
loss  dependent  upon  dividends  from  this  source  for  .in  income.  The  list  of 
shareholders  comprises  nearly  400  names,  and  there  is  no  stock  list  having 
shareholdors  more  Avichdy  scattered,  and  in  sums  more  various,  anrl  in  which 
tho  average  holding  indicates  a  greater  number  of  estates,  families,  trusts, 
females,  and  others,  to  whom  a  regular  dividend  is  of  vital  importance.  It 
is  hardly  to  be  supposed  that  more  than  one-tliird  of  this  large  number  of 
I)crsons  quite  apprehend  all  the  circumstances  of  the  case,  and  the  peril  to 
which  their  income  from  this  source  is  exposed.  Hence,  there  is  all  the 
more  necessity  for  accepting  the  sottloment  which  will  make  certain  for 
tho  future  a  rate  of  interest  which,  in  these  times,  it  is  next  to  impossible 
to  secure.  To  refuse  tho  otFor  made  would  have  a  most  disastrous  effect 
in  tho  probable  cessation  of  all  income  from  this  source  for  at  least  somo 
years  to  come. 


10 


CA2i  JiETTEB  TERMS  BE  HADt 


\i\ 


'l! 


ii 


hi 


i 


W 


i    jJ 


It  has  been  MUggesteJ  that  perhaps  some  bettor  terms  could  be  got  than 
those  now  proposed,  should  the  present  offers  be  rejected.  The  parties  who 
think  this  know  very  little  of  tlio  diflficulties  encountered  in  giving  shape 
to  the  plan  now  before  them,  and  the  favorable  terras  which  .are  oft'ered. 
The  rate  guaranteed  is  higher  than  that  originally  conceded,  though  it  is 
Jowor  than  the  ofiicers  of  the  Montreal  Company  demanded  at  first.  But 
it  is  not  possible  that  any  more  favorable  figures  can  be  secured,  and  the 
conviction  of  those  familiar  with  the  whole  subject  is,  that  if  the  terms  are 
not  promptly  acceded  to,  the  whole  negotiation  will  drop,  and  that  no  temis 
whatever  Avill  be  oft'ered.  The  proposal  is  looked  upon  by  disinterested 
parties  as  an  exceedingly  liberal  one,  the  plans  proposed  comprehensive 
and  uaobjectionable ;  and  the  reetilts  can  nardly  fail  to  be  advantageous,  not 
only  to  the  shareholders  of  the  Montreal  and  Dominion  Companies,  but  to 
the  public  generally,  who  will  seo  in  the  conditions  imposed,  the  prospect 
of  a  continuance  of  reasonable  rates,  the  restoration  of  telegraphic  prop- 
erty, and  increased  etliciency  in  telegraphic  service,  from  the  improved 
manageiiient  which  will  follow  the  acceptance  of  the  terms  proposed. 

THE  DIFFERENCE  IN  GUARANTEES. 

In  some  quarters  it  is  urged  that  the  rate  of  interest  to  the  Dominion 
Company  of  six  per  cent,  per  annum,  is  relatively  more  favorable  than  that 
of  eight  per  cent,  to  the  Montreal  Company,  and  it  is  maintained  that  the 
latter  should  be  increased  in  consequence.  In  reply  to  this  statement,  it  is 
sufficient  to  say  that  the  rate  to  the  Dominion  Company  was  fixed  years 
ago  by  the  terms  of  its  lease,  that  on  its  assignment  to  o  Canadian  company 
it  should  carry  an  increase  rental  of  one  per  cent.,  the  rate  hitherto  being 
being  five  i)er  cent.  The  fact  that  i\\vi  extra  charge  has  to  be  i)aid,  indicates 
that  instead  of  being  what  it  has  hitherto  been,  practically  an  American 
company,  it  will  now,  under  the  new  arrangement,  pass  into  the  control  of 
a  Canadian  company,  so  that  the  effect  of  the  new  arrangement  will  be  to 
nationalize  what  has  hitherto  been  dc-nationalized.  Under  cuch  circum- 
stances it  will  be  seen  how  insincere  and  unfounded  is  the  shrill  cry  of 
patriotic  affright  which  has  been  raised  for  selfish  purposes,  in  relation  to 
this  matter. 

THE  I'OSITION  OF  YOUR  DIRECTORS. 

The  decision  oi'  a  number  of  the  shareholders,  it  is  alleged,  will  be  in- 
fluenced, very  much  by  the  position  Avhich  the  directors  of  the  Montreal  Tele- 
graph Compauy  assume  on  this  question.  It  is  to  be  said  on  behalf  of  these 
gentlemen,  that  the  negotiations,  extending  over  some  months,  indicate  on 
their  part  a  very  grea^  anxiety  to  get  the  best  possible  terms  for  their  con- 
stituents. At  the  same  time,  it  is  apparent  they  have  not  felt  that  they 
should  assume  the  responsibility  of  deciding  whether  acceptance  or  re- 
jection of  these  proposals  is  the  best  for  all  interests.  The  fact  that  they 
have  agreed  to  call  you  together  to  pass  upon  it,  is  presumed  to  be  a  virtnal 
acceptance,  so  far  as  they  are  concerned,  of  the  i^roposal  before  you  ;  bun  in 
order  to  relieve  them  from  any  such  resiionsibility,  it  is  juggested  that  par- 
ties who  desire  to  express  their  opinion,  either  favorable  or  adverse  to  the 


THE  POSITION  OF  YOVK  DIRECTORS. 


11 


got  than 
rtiea  who 
ng  shape 
o  offered, 
ough  it  is 
irst.  But 
I,  aud  the 

toriDS  are 
t  no  temis 
iintorested 
irehcnsivo 
geous,  not 
lies,  but  to 

0  prospect 
phic  prop- 

1  improved 
osed. 


!  Dominion 
e  than  that 
3d  that  the 
,ement,  it  is 
fixed  years 
an  oompany 
hcrto  being 
id,  indicates 
II  American 
le  control  of 
it  will  be  to 
icli  circum- 
shrill  cry  of 
relation  to 


will  be  in- 
)ntreal  Tele- 
lalf  of  these 
indicate  on 
be  their  con- 
It  that  they 
fcance  or  re- 
let that  they 
be  a  virtual 
you ;  bur.  in 
ted  that  par- 
iverso  to  the 


I 


plan,  should  definitely  instruct  either  directors,  or  some  other  reprosentative, 
to  give  expression  to  their  views.  In  order  to  relievo  directors  from  any 
responsibility,  three  stockholders,  one  representing  Quebec,  and  two  others 
Montreal,  have  kindly  consented  to  accept  proxies  of  the  shareholders  who 
are  favorable  to  this  plan.  The  shareholders  representing  Montreal  are  Mr. 
John  Crawford,  President  of  the  City  Passenger  Railway,  the  largest  indi- 
vidual holder  of  the  stock,  and  Mr.  James  Fewer  CIcghom,  of  the  well- 
known  firm  of  Messrs.  J.  G.  McKenzio  &  Co.  The  other  name  is  that  of 
Mr.  George  LMchard  Renfrew,  a  well  known  resident  of  Quebec,  who 
will  accept  a  similar  trust.  A  power  of  attorney  will  be  found  accom- 
panying this  pamphlet  (see  last  page)  in  favor  of  these  gentlemen,  which 
can  be  transmitted  to  them  by  stich  stockholders  as  are  favorable  to  the 
project.  The  question  now  presented  to  the  shareholders  is  of  such  vital 
importance  to  them,  that  the  specific  instructions  contained  in  the  power  of 
attorney  should  be  afforded.  Hence  new  proxies  should  bo  substituted  in 
the  place  of  those  hitherto  held. 

The  impression  is  a  most  unjust  one,  which  has  in  some  quarters  been 
conveyed,  that  certain  of  the  directors  were  opposed  to  the  i>roject  because 
a  change  in  the  administration  might  interfere  with  such  privileges  and 
advantages  as  they  had  hitherto  enjoyed.  The  injustice  of  this  implication 
is  found  in  the  fact  that  the  autonomy  of  the  Montreal  Company  is  to  bo  so 
completely  preserved  that,  even  if  this  were  an  actuating  motive,  it  would 
have  no  occasion  to  exist.  To  relieve  the  directors  from  a  position  in  which 
any  such  consideration  might  be  said  to  influence  them,  eitherfor  or  against 
the  proposition  now  before  you,  the  suggestion  is  made  that  proxies  should 
be  in  the  hands  of  shareholders  separate  from  the  management. 

Not  a  few  shareholders  indicate  a  natural  reluctance  to  contribute  to 
the  withdrawal  from  active  operation  of  a  com]»any  Avhich  has  been  so  long 
and  honorably  identified  with  the  business  interests  of  the  country.  But 
no  apprehension  of  the  kind  need  exist ;  for  both  with  regard  to  legal  and 
business  considerations,  it  would  bo  the  best  policy  to  iireserve,  to  as  great  an 
extent  as  possible,  all  the  advantages  arising  from  the  organization,  powers, 
inttaences,  aud  surroundings  of  the  two  companies  which  have  so  woven 
themselves  into  the  warp  and  woof  of  Canadian  business  interests  since  their 
organization.  So  far  as  the  public,  and  so  far  as  the  telegraph  companies 
themselves  and  their  employees  are  concerned,  as  little  change  as  possible 
is  contemplated,  except  that  the  business  of  telegraphy  will,  where,  it  is 
possible,  be  a  groat  deal  bettor  done,  and  the  condition  of  telegr;.  i»h  iiroperty 
made  more  stable  and  permanently  profitable. 

THE  POSITION  OF  THE  WESTERN  UNION  COMPANY. 

Some  feeling  appears  to  be  entertained  by  the  stockholders  that  the 
authorit.es  of  the  Western  Union  Company  are  using  undue  pressure  to 
accomplish  their  own  purposes  in  Canad?^..  This  view  of  the  matter  is 
clearly  unjust.  It  should  be  borne  in  mind  that  the  Western  Union  Company 
now  own  a  line  of  their  own,  extending  the  whole  length  of  the  Dominion. 


'j 


1 ' 


f   5 


{  ...i!) 


IS 


T£r^  POSITION  OF  THE  WESTERN  UNION  COMPANY. 


It  should  also  bo  borne  in  mind  that  they  have  a  large  and  valaablo  buHi- 
ness,  which  it  is  the  most  natural  thing  in  the  world  they  should  divert  in 
the  direction  of  their  own  lines.  This  business  includes  all  that  is  trans- 
mitted from  the  United  States  and  all  that  reaches  them  by  cable.  If  the 
Montreal  Company  had  parallel  lines  rimning  to  New  York  and  Chicago, 
they  could  not  be  blamed  if  they  gave  their  business  to  their  own  company, 
any  more  than  the  Western  Union  can  bo  for  confining  their  messages  to 
their  own  leased  lino  in  Canada.  If,  however,  this  company  is  willing  to 
make  such  traffic  arrangements  as  will  beget  to  the  Montreal  Company  a 
reasonable  return  upon  their  cajiital,  and  thus  harmonize  conilictiug  inter- 
ests, surely  the  proposition  ought  to  be  promjitly  accepted,  and,  instead  of 
being  harshly  criticised,  the  Western  Union  Company  ought  to  bo  com- 
mended for  its  liberality  and  consideration.  If  the  olfer  Avas  only  six  pe/ 
cent,  per  annum,  and  the  conditions  otherwise  exacting  ;  if  the  rate  was  not 
fixed  at  twenty- five  cents,  and  if  the  control  of  the  telegraph  was  not  Cana- 
dian, there  might  be  some  valid  objection.  But  with  all  these  conceded, 
and  a  dividend  guaranteed  as  good  as  that  attached  to  any  other  sound 
security  v/hatever,  surely  it  is  "  looking  a  gift  horse  in  the  mouth  "  to  criti- 
cise, carp  at,  and  refuse  the  offers  made.  This  refusal,  should  it  occur, 
will  likely  be  all  the  more  keenly  resented,  in  view  of  its  liberality  an<l 
consideration. 

MR.  JAY  GOULD. 

The  virulent  attacks  which  have  been  made  upon  Mr.  Jay  Gould  in 
connection  with  this  matter  make  it  i)roper  that  some  allusion  should  bo 
made  to  the  position  ho  holds  in  relation  to  the  telegraph  interests  of 
Canada.  In  the  first  place  Mr.  Gouhl  has  a  larger  investment  in  Canada 
than  any  other  single  non-resident,  and  in  Dominion  Telegr.iph  stock  alone, 
his  holding  amounts  to  nearly  a  quarter  of  a  million.  This  sum  was  ad- 
vanced two  years  ago  in  hard  cash,  for  a  purchase  of  the  stock,  and  mainly 
went  to  liquidate  the  indebtedness  of  the  Dominion  Company  when  it  was 
on  the  eve  of  bankruptcy.  It  had  readied  this  condition  notwithstanding 
the  prevalence  of  the  twenty-five  cent  rate  for  messages;  and  the  subsequent 
uncalled  for  reduction  to  twenty  cents  must  have  entailed  a  heavy  loss  on 
the  company.  The  consequence  of  Mr.  Gould's  investment  was  that  the 
cheapest  telegraphy  in  tho  world  has  been  afforded  to  Canadians  in  the 
past  two  years,  and  if  the  future  is  to  be  judged  by  tho  past,  his  continued 
interference — did  he  seek  to  interfere — should  be  coveted  rather  than  con- 
demned. But  Mr.  Gould  does  not  seek  to  meddle  with  Canadian  telegraph 
matt  ''8,  except  as  tho  largest  stockholder,  to  favor  a  plan  whereby  a  rea- 
soDii  lo  return  can  be  had  on  his  investment.  No  <  oncern  has  been  less 
intf  tered  with  than  has  the  Dominion  Conq)any  since  it  was  leased  to  Mr. 
Gould  and  his  associates.  Not  only  in  connection  with  tho  Dominion 
Company,  but  in  regard  to  the  whole  telegraph  interests  of  Canada  no 
treatment  could  be  fairer,  more  considerate,  and  even  generous,  than  has 
been  experienced  at  the  hands  of  these  Americans.  To  add  emphasis  to  the 
liberality  of  their  policy  in  the  past,  and  to  show  how  littlo  ground  there  is 
for  the  charge  that  they  are  trying  to  get  possession  of  Canadian  telegraph 


Y. 


MR.  JAY  GOULD. 


13 


iblo  buHi- 
divorfc  in 
i,  is  trans- 
5.     If  the 
L  Chicago, 
company, 
lessages  to 
willing  to 
Jompauy  a 
itiug  inter- 
instead  of 
;o  be  corn- 
inly  six  pe<: 
ate  was  not 
i  not  Cana- 
)  conceded, 
ither  sonnd 
ih  "  to  criti- 
[d  it  occnr, 
jerality  and 


ay  Gould  in 
m  should  bo 

interests  of 
it  in  Canada 

stock  alone, 
sum  was  ad- 
;,  and  mainly 

when  it  was 
withstanding 
10  subsequent 
heavy  loss  on 
was  that  the 
adians  in  tho 
his  continued 
;her  than  con- 
lian  telegraph 
vhereby  a  roa- 

has  been  less 
s  leased  to  Mr. 
tho  Dominion 
of  Canada  no 
■rous,  than  has 
mphasis  to  tho 
ground  there  is 
,dian  telegraph 


lines,  Mr.  Gould  and  liis  friends  now  agree  to  assign  back  to  a  Canadian 
company  their  lease  of  the  Dominion  Company,  lie  thus  returns  to  Cana- 
dian control  the  largo  interest  he  has  ucquircd  in  the  country,  trusting  to 
tho  good  sense  of  tho  Canadians  tlioms  ^Ivcs  to  see  to  it  that  lie  gets  a  fair 
return. 

AVhen  tho  consolidation  of  tho  Telegraphs  was  effected  in  the  United 
States  there  was  a  great  outcry  made  that  rates  would  bo  advanced,  and  a 
grinding  monopoly  the  consequence.  Tho  result  however  has  been  that 
rates  have  not  been  advanced,  but  on  tho  contrary,  equalized  and  made 
more  uniform ;  and  tho  service  has  been  all  so  perfected  and  improved,  that 
a  great  change  has  conio  over  public  sentiment  in  this  matter.  I  am  con- 
fident that  this  will  be  the  case  in  (^anada,  if  thesti  arrangements  are  carried 
out  according  to  the  jiresent  intentions  of  parties  interested,  and  that  tho 
service  Av  ill  bo  made  equal  to  that  of  nny  other  Telegraph  service  of  any 
other  country  in  tho  world. 

GOVERNMENT  INTERFERENCE. 

There  seems  to  rest  in  the  minds  of  some  tho  expectation  that  govern- 
ment interference  will  prevent  a  consolidation  of  telegraph  interests.  How 
government  could  interfere  without  some  such  consolidation  is  a  mystery.  It 
is  alleged  that  this  stei)  would  prevent  a  monopoly,  yet  how  tho  government 
could  assume  the  telegraphs,  and  not  create  a  monopoly,  is  not  explained. 
Whether  a  government  monopoly  is  any  more  enjoyable  than  a  free  lield  and 
no  favor,  for  telegraphic  enterprise  as  for  all  other  business  pursuits,  is  a 
question  not  fully  discussed.  Whiit  advantages  would  come  from  government 
telegraphs  over  what  are  at  present  enjoyed  are  unenumorated.  Certainly 
it  would  not  be  rates  lower  than  have  hitherto  prevailed,  or  that  it  is 
agreed  will  xir'.ivail  under  the  proposed  fusion  of  interests.  Clearly  it  would 
be  impossible  to  more  ctfectually  serve  tho  public,  to  offer  facilities  extending 
over  a  wider  area  of  country  or  a  greater  number  of  localities  than  now 
exists.  In  all  towns  there  is  only  one  post  office,  yo'v  there  have  been  in 
almost  all  places  two  telegraph  offices.  In  all  large  cities  the  post  office  is 
confined  to  ono  central  location,  Avliile  tho  telegraph  otters  its  services  at  a 
dozen  different  points.  Tho  English  government,  with  its  enormous  popu- 
lation, its  density,  and  tho  contiguity  of  its  towns,  offers  by  its  telegraph 
service  no  advantages  greater  than  are  now  and  will  be  ofiercd  in  Canada,  in 
point  of  either  rapidity,  accuracy,  extent  of  facilities,  or  cheapness.  What 
real  practical  benefit  would  therefore  come  from  government  interference  is 
difficult  to  define.  What  disadvantages  inight  follow  are  not  so  difficult  to 
enumerate,  especially  in  the  patronage  for  party  purposes,  the  <lisclosures 
of  business  and  political  plans  by  tho  ease  with  which  telegraphy  is  now 
interpreted,  and,  above  all,  tho  dangers  that  might  result  from  an  aggrega- 
tion of  power  in  the  hands  of  politicians,  to  be  used  for  purposes  of  their 
own.  That  tho  government  should,  with  all  its  other  cares,  bo  expected 
to  take  over  tho  business  of  telegraphy,  and  yet  bo  in  such  haste  and  at 
such  cost  to  get  out  of  tho  business  of  building  and  managing  railways,  is 
one  of  these  vague  ideas  that  llud  lodgement  uiustly  iu  the  miuds  of  those 


;j;-.r".3i»i.t^^ 


14 


a  ()  VERNMENT  INTERFEUESCE. 


fi 


I     ' 


i'l 


III 


who  do  not  seriously  refltMt  upou  the  subject.  Among  the  serious  advo- 
cates of  sueh  a  project  will  be  found  some  patriots  that  hope  to  make 
a  place  for  themselves  or  their  friends.  •     ■  <   • 

But  to  the  shareholders  of  the  Montreal  Company,  the  plan  now  before 
them  should  have  an  additional  attraction,  with  a  prospect  of  government 
interference,  for  in  that  case  the  guarantee  of  eight  per  cent.,  which  this 
oflfer  brings  to  their  acceptance,  would  have  to  be  assumed  by  the  Govern- 
ment, and  hence  the  stockholders  would  receive  a  much  higher  rate  of 
dividend  than  if  the  property  was  to  be  taken  without  such  a  guarantee. 

THE   GREAT   NORTH   WESTERN   TELEGRAPH   COMPANY   OF 

CANADA. 

The  machinery  which  it  is  proposed  to  use  to  accomplish  the  union  of 
telegraph  interests  in  the  Dominion  is  that  fouad  in  the  charter  of  the 
Great  North  Western  Telegraph  Company  of  Canada.  This  company  was 
incorporated  by  Parliament  at  its  session  before  last,  and  has  been  regularly 
organized  for  the  purpose  of  acquiring  and  working  telegraphs  in  the 
North  Western  Provinces.  It  already  owns  and  operates  all  the  lines  be- 
longing to  private  individuals  in  Manitoba,  with  a  subscribed  capital  of 
$50,000.  It  is  now  intended  to  increase  the  capital  to  $500,000,  the  greater 
portion  of  which  has  already  been  subscribed  for  by  parties  abundantly 
able  to  pay  it  up,  which  subscription  will  bo  called  for  immediately  in 
the  amounts  required.  The  President  of  the  company  has  hitherto  been 
the  Hon.  A.  G.  Bannatyne ;  Vice-President,  J.  A.  M.  Aikens  (son  of  Hon. 
J.  C.  Aikens,  Secretary  of  State,  Ottawa);  and  Mr.  E.  P.  Leacock,  Secre- 
tary. Among  the  existing  Directors  are  Hon.  John  Xorquay,  Premier  of 
Manitoba;  John  Schultz,  M.  P.,  James  Anderson,  Richard  Fuller,  and 
Horace  McDougall,  Winnipeg;  Adam  Brown,  Hamilton;  O.  S.  Wood, 
Montreal,  and  Erastus  Wiman. 

Mr.  AVood  has  been  for  years  the  largest  stockholder  in  the  North 
Western  Company,  whoso  lines  exclusively  occupied  the  vast  territory  in- 
cluded in  Wisconsin,  Iowa,  Minnesota,  and  Dakota,  and  whose  lines  afford 
the  only  means  of  communication  to  Manitoba.  His  connection  with  this 
company  is,  therefore,  a  most  natural  one ;  and  it  is  fortunate  that  his  great 
experience  in  telegraph  matters,  and  his  high  character  for  integrity  and 
prudence,  can  be  made  available  at  the  present  juncture.  His  presence  in 
the  board  is  a  guarantee  that  the  interests  of  the  Montreal  Company,  among 
whose  stockholders  ho  has  so  many  friends,  will  not  be  allowed  to  suffer. 

Through  the  courtesy  of  Mr.  Bannatyne,  I  have  been  elected  to  the 
position  oi  President,  because  of  the  necessity  of  having  some  person 
thoroughly  familiar  Avith  the  matter  to  close  the  contracts  betv  een  the 
various  companies.  A  resolution  authorizing  this  action  has  passed  the 
Board  of  Directors,  subject  to  ratification  of  the  shareholders  at  a  meeting 
■wMcn  has  been  called  for  that  purpose.  Whether  I  shall  continue  to 
occupy  this  position  of  President  or  not,  will  rest  la  the  future  -with  the 
shareholders   and   directors.     It  is   the   intention,    at   the  next   annual 


,.,* 


Nonrn  western  teleghaph  vomi'any  of  caxada.     15 


ioub  advo- 
)0  to  mako 

now  before 
jovernment 
wlr.cli  this 
slie  Govern- 
rber  rate  of 
larantee. 

ANY   OF 

ho  imioii  of 
arter  of  the 
ompany  was 
3cn  regularly 
raphs  iu  the 
the  lines  bc- 
ecl  capital  of 
),  the  greater 
J  abuudantly 
imediatoly  in 
litherto  been 
(son  of  Hon. 
sacock,  Secre- 
,y,  Premier  of 
I  Fnller,  and 
O.  S.   Wood, 

in  the  North 
t  territory  in- 
se  lines  afford 
tion  with  this 
that  his  great 
integrity  and 
^is  presence  in 
mpany,  among 
ed  to  suffer. 

elected  to  the 
g  some  person 
8  betv  een  the 
las  passed  the 
rs  at  a  meeting 
ill  continue  to 
iituro  with  the 
0  next   annual 


1 


meeting,  to  elect  such  a  board  of  directors  as  will  bo  rei)resontativt,  iu  its 
character  of  all  the  various  local  interests.  In  all  respects  the  control 
and  government  of  the  company,  it  will  bo  seen,  is  entirely  ('anadian,  the 
only  non-resident  from  the  Dominion  being  myself.  The  fact  that  I  am  a 
resident  of  New  York  m.-^kes  me  none  the  less  sincere,  as  a  Canadian,  to 
further  the  Canadian  telegraph  interests  in  the  future,  as  I  have  had  the 
good  fortune  to  do  in  the  iiast.  The  large  amount  of  telegraphic  business 
which  my  lirm  dispenses  at  its  eighty  different  branches,  amounting  to  over 
^.'jO.OOO  annually,  gives  me  here  a  legitinmte  claim  to  consideration.  But, 
aside  from  this,  if  1  have  any  claim  to  the  conlideuce  of  the  telegraph 
authorities  in  N(!W  York,  I  think  they  will  admit  that  it  is  based  mainly 
upon  my  loyalty  to  Canadian  interests,  and  to  my  great  anxiety  at  all 
times  to  advance  them.  That  my  position  here  and  accessibility  to  these 
authorities  will  be  found  iuiluential  for  the  future  advantngo  of  these 
interests,  1  trust  none  will  have  occasion  to  deny.  It  is  safe  to  say  that,  but 
lor  this  coutiguiiy  and  iniluence,  the  favorable  proposition  now  before  you 
would  never  have  been  submitted. 

I  refer  to  all  these  particulars,  both  as  to  the  company  and  to  myself, 
simply  because  the  demand  Ibr  information  on  these  points  seeniod  to  be  a 
reasonable  one,  and  I  have  endeavored  to  comply  with  it  iu  the  fnll'jst 
manner. 

nUCTICAL  KESULTS. 

Permit  me  to  close  with  an  enumeration  of  some  of  the  advantages 
which  are  certain  to  result  from  a  union  of  telegraph  interests  in  Canada. 
In  the  first  place,  the  rate  Avill  bo  permanently  and  dcliuitely  lixed  at  a 
maximum  of  twenty-live  cents  for  ten  words.  Further,  it  is  proposed  that  a 
rate  of  iifteen  cents  only  shall  be  charged  between  towns  and  villages  with- 
in twelve  miles  of  each  other,  and  a  rate  still  more  favorable  for  night 
messages.  It  is  also  understood  that  the  maximum  rate,  for  press  reports, 
shall  not  exceed  ^5  cents  i)er  hundred  words,  and  that  if  a  lower  rate  than 
this  can  be  afforded,  for  lengthy  reports,  sent  during  the  night,  it  will  be 
conceded. 

The  plan  proposed  is  one  by  which  the  lines  of  the  Dominion  Company 
will  revert  to  fJanadiau  management,  and  under  which  the  entire  telegraph 
interests  of  the  whole  country  will  be  harmonized,  and  all  worked  as  inti- 
mate connections  of  tho  Western  Union  Company  in  the  United  States, 
getting  the  beuelit  in  this  way  of  all  the  advantages  of  that  company's  vast 
and  complete  organization.  A  large  sum  of  money  will  have  to  be  expended 
on  lines  of  both  companies  in  order  to  put  them  in  an  efficient  state  of  repair, 
and  to  provide  the  increased  facilities  necessary  for  the  business.  It  is  con- 
templated to  expend  not  less  than  $40,000  within  a  year  for  this  purpose. 

The  advantages  of  this  arrangement  Avill  bo  that  the  service  can  be  in 
every  way  greatly  improved,  not  only  as  regards  home  and  local  service,  but 
as  regards  the  foreign  connections  in  every  direction.  The  new  company 
will  be  able,  under  these  new  arrangements,  to  provide  new  and  more  direct 
connections,  without  transfer  or  repetitions,  and  consequent  delay,  between 


i-*^i!,|i| 


16 


J7iM  C  TIC  A  L  11 ES  UL  TS. 


;« 


.■^'i 


'■I 


'1 


all  princiiJal  towns  in  the  custom  and  western  provincos  of  the  Dominion. 
It  will  also  bo  o.ble  to  establish  dlroct  connection  between  Jill  the  principal 
towns  in  Canada,  and  the  principal  cities  in  the  United  States  ;  thus  i'acili- 
tatiug  greatly  the  business  intercourse  bo  ween  peoi)le  on  both  sides  of  the  line. 

It  may  not  have  been  generally  known,  that  heretofore  there  has  been 
no  geographical  or  national  boundary  linii  dividing  the  telograi)h  system. 
Hereafter  there  will  be  a  still  greater  interlacing  an«l  provision  for  com- 
munication. It  will  be  the,  aim  of  the  new  couFolidated  company  to  so 
amply  an  J  perfectly  provide  the  telegraph  facilities  needed,  both  as  regards 
their  ex*:6r.t  and  cheapness,  as  to  make  an  opjiosition  unnecessary.  Unless 
the  new  company  does  this,  its  promoters  are-  well  aware  that  thoy  need  not 
expect  to  be  without  competition  for  any  length  of  time;.  There  can  be  no 
monopoly  of  the  telegraph  business  in  Canada.  Telegraph  companies  may 
be  formoJ,  at  an  hour's  notice,  to  build  lines,  nnder  tho  general  act  of  Pai- 
liament. 

Of  course,  there  are  many  i)eoplo  who  wonld  i)refer  that  tho  companies 
should  go  on  fighting  each  other,  until  both  were  completely  crippled  and 
exhausted,  but  it  certainly  is  not,  in  tho  long  run,  for  the  benefit  of  the 
public,  that  this  should  bo  done.  The  country  can  be  better  served  by  one 
strong  and  able  company,  than  by  two,  or  half  a  dozen,  in  a  crippled  and 
bankrupt  condition. 

There  are  numerous  other  advantages,  aside  from  tho  steady  dividend 
guaranteed  shareholders  of  tho  Montreal  Company,  which  will  follow  the 
acceptance  of  the  propositions  before  you,  and  which,  it  is  submitted,  can 
hardly  be  expected  unless  those  propositions  are  agreed  to.  But  your 
liatience  has  already  been  greatly  taxed  with  this  communication,  fov  the 
length  of  which  I  have  to  apologize,  and  urge,  in  palliation,  my  anxiety  to 
place  you  in  possession  of  all  the  facts  and  considerations  necessary  to  an 
intelligent  verdict  on  the  grave  question,  as  to  whether  you  will  accept,  or 
reject,  the  proi)Osal8  that  are  now  before  you. 

Soliciting  personal  communication  from  shareholders  desiring  such 
further  information  as  I  can  give,  I  have  tho  honor  to  be 

'      •':  i;'        <     •  Your  obedient  servant,    ■.-•■■.:     .       ^      ^;     .    • 

ERASTUS  WIMAN. 


314  Bhoadway,  New  York,  July  1, 1881. 


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